Valence Technology Delivers Saphion Lithium-ion Batteries to Graham-Field Health Products

     U-Charge Power Systems Enable Extended Range, Lighter Weight
                         for Power Wheelchairs

   Valence Technology, Inc. (Nasdaq:VLNC) today announced the
delivery of its U-Charge(R) Power Systems to Graham-Field Health
Products, a major manufacturer and distributor of healthcare products.
These battery systems are based on Valence's proprietary Saphion(R)
technology, the industry's first commercially available, safe,
large-format lithium-ion rechargeable battery technology.
   Per an agreement announced in July 2004, Graham-Field has the
exclusive right to resell Valence's U-Charge Power System in the power
wheelchair and medical scooter markets within the U.S.
   "Using U-Charge Power Systems, we have been able to dramatically
improve the performance and reduce the weight of our new power
wheelchair models. We can now provide users with the ability to be
completely mobile for an entire day, and lifting chairs in and out of
vehicles becomes a much easier task," said Irwin Selinger, president
and CEO of Graham-Field.
   Saphion technology enables the creation of large-format batteries
and eliminates safety and environmental concerns associated with
oxide-based battery technologies. The U-Charge Power Systems are
designed as direct replacements for lead-acid batteries used in deep
cycling applications.
   "Our U-Charge battery systems offer more energy and last much
longer than lead-acid batteries, yet are lighter weight and
maintenance-free. From a total cost of ownership perspective, our
battery systems are an optimal alternative to lead-acid batteries for
a number of motive and industrial applications," said Dr. James
Akridge, president and CEO of Valence Technology, Inc.

   About Graham-Field Health Products

   GF Health Products, Inc., headquartered in Atlanta, GA, is a major
manufacturer and distributor of healthcare products for the homecare,
long term care and acute care markets. Its products include standard
and power wheelchairs, homecare and long term care beds, patient aids,
diagnostics and specialty seating products.

   About Valence Technology, Inc.

   Valence Technology develops and markets battery systems using
Saphion(R) technology, the industry's first commercially available,
safe, large-format Lithium-ion rechargeable battery technology.
Valence Technology holds an extensive, worldwide portfolio of issued
and pending patents relating to its Saphion technology and lithium-ion
rechargeable batteries. The company has facilities in Austin, Texas,
Las Vegas, Nevada, and Suzhou and Shanghai, China. Valence is traded
on the Nasdaq Capital Market under the symbol VLNC and can be found on
the internet at www.valence.com.

   Safe Harbor Statement

   Some information included in this press release may contain
forward-looking statements, within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Act of 1934.
Forward-looking information involves important risks and uncertainties
that could significantly affect anticipated results in the future and,
accordingly, such results may differ materially from those expressed
in any forward-looking statements made by or on behalf of Valence
Technology. Factors that could cause actual results to differ include
the demand for our products, competitive factors in the businesses in
which we compete, continued use and acceptance of our Saphion
technology, and the level and pace of expansion of our manufacturing
capabilities. These and other risk factors that could affect actual
results are discussed in Valence's periodic reports filed with the
Securities and Exchange Commission, including its Report on Form 10-Q
for the quarter ended June 30, 2005, and the reader is directed to
these statements for a further discussion of important factors that
could cause actual results to differ materially from those in the
forward-looking statements. Valence Technology does not undertake any
obligation to update or supplement any forward-looking statements to
reflect subsequent events or circumstances and cannot assure that
projected results or events will be achieved.